Ring Around the Debt

http://www.reuters.com/article/us-eurozone-future-idUSKBN18Q23I

One idea in the paper that did not involve any mutualization of debt was for a private bank to buy a portfolio of euro zone government bonds and issue its own bond backed by that portfolio. Such a Sovereign Bond Backed Security (SBBS) could have senior and junior tranches and provide a higher level of safety for the investor, officials said.

Safety like AAA Mortgage Backed Securities?  I can’t wait!

 

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